Excessive bone loss in rheumatoid arthritis, periodontal disease and some tumor- associated bone metastasis is mostly due to an abnormal activation of the immune system leading to hyper-stimulation and activation of osteoclasts (OCs) [1-3]. Identifying common signaling molecules affecting the osteo-immune system and their impact on normal and pathological bone loss may lay the groundwork for future therapies or the variety of diseases that affect both bone and the immune system. We have identified a novel role for the immunomodulatory protein phospholipase Cgamma2 (PLCgamma2) as central mediator of RANKL (Receptor Activator of NFkappaB Ligand)-induced osteoclastogenesis, independent of PLCgamma1. OCs, the principal bone resorbing cells, develop from bone marrow macrophages (BMMs) primarily under the influence of two major regulators: the macrophage colony stimulating factor (M-CSF) and receptor activator of NFkappaB ligand (RANKL), and less understood costimulatory factors that act via immunoreceptor tyrosine-based activation motif (ITAM)-containing receptors on OC precursor cells [2,4, 5]. Our data indicate that targeted deletion of PLCgamma2 in mice leads to an osteopetrotic phenotype. PLCgamma2-deficient OC precursors fail to differentiate due to defective activation of AP1 and NFkappaB and a failure in upregulation of NFATc1, a master transcription actor for osteoclastogenesis. While PLCgamma2 phosphorylation and its catalytic activity are required for ITAM - dependent upregulation of NFATc1, activation of JNK and NFkappaB pathways may be dependent on the capacity of PLCgamma2 to bind and activate GAB2, an adapter protein shown to be important in RANKL-mediated osteoclastogenesis [6], and modulate GAB2 recruitment to the RANK signaling complex. The non-redundant role of PLCgamma2 in OC differentiation suggests that identifying the structural domains which make PLCgamma2 unique in its capacity to promote OC differentiation/function may unveil novel OC regulatory mechanisms and provide the basis for new antiresorptive therapies. Based on observations presented under preliminary data we hypothesize that: 1) the catalytic activity of PLCgamma2 is required for OC differentiation by modulating NFATc1 upregulation, but not JNK or NFkappaB 2) the adapter function of PLCgamma2 is required for osteoclastogenesis by modulating GAB2 activation and subsequent activation of JNK and NFkappaB 3) PLCgamma2 mediates osteoclastogenesis and osteolytic responses in vivo, at least in part, through the JNK/NFkappaB axis and the NFATc1 pathway. In this proposal we seek to: Specific Aim 1: a) generate PLCgamma2 mutants to clarify the role of the catalytic activity and the adapter function of PLCgamma2 during regulation of OC differentiation, and b) generate TAT-fusion-proteins expressing unique regions of PLCgamma2 required for osteoclastogenesis with the intent to identify novel anti-resorptive approaches. Specific Aim 2: a) determine the role of PLCgamma2 in OC differentiation and inflammatory osteolysis, in vivo, and b) test the in vivo osteolytic response in mice harboring mutated forms of PLCgamma2 and the anti-resorptive effects of TAT-fusion proteins encompassing functional domains of PLCgamma2.